Aetna files antitrust lawsuit against Michigan Blue Cross Blue Shield

Consumers who already feel like they pay out the nose for health care will likely be angered by a new lawsuit claiming a major health insurer in Michigan unfairly caused premiums to rise throughout the state.

Yesterday, health insurance company Aetna Inc. filed an antitrust lawsuit against Blue Cross Blue Shield of Michigan, Michigan’s biggest health insurer, in which it alleges that Blue Cross Blue Shield of Michigan raised rates to consumers and gave the extra money to hospitals that agreed to charge higher prices to the insurer’s competitors. Aetna says the scheme hurt its efforts to expand its business in Michigan. The company currently has roughly a 5 percent market share in Michigan, while Blue Cross Blue Shield of Michigan provides insurance to at least 60 percent of residents in the state.

The anti-competition allegations aren’t new. In October 2010, the Department of Justice sued Blue Cross Blue Shield of Michigan, claiming the insurer forced 70 Michigan hospitals to give it the best prices in the state. The Detroit Free Press reports that the Michigan Attorney General’s Office supports the government’s lawsuit.

The Wall Street Journal notes that the allegations against Blue Cross Blue Shield of Michigan reflect the continuing argument nationwide about whether consolidation within the health care industry increases costs.